Please answer required 1&3

The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow: Dirt Mountain Racing Total Bikes Bikes Bikes $ 927,000 $262,000 $401,000 $ 250,000 468,000 110,000 201,000 157,000 459,000 252,000 206,000 101,000 Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses Total fixed expenses Net operating income (10) 69,200 8,700 40,200 20,300 44,100 20,400 7.900 15,800 114,800 40,300 38,500 36,000 185,400 52,400 81,400 51,600 413,500 121,800 168,000 123,700 $ 45,500 $ 30,200 $ 38,000 $(22,700) 'Allocated on the basis of sales dollars. Management is concerned about the continued losses shown by the racing bikes and wants a recommendation as to whether or not the line should be discontinued. The special equipment used to produce racing bikes has no resale value and does not wear out. Required: 1. What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes? 2. Should the production and sale of racing bikes be discontinued? 3. Prepare a properly formatted segmented income statement that would be more useful to management in assessing the long run profitability of the various product lines. Answer is not complete Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes? $ 46,100 Financial (disadvantage) per quarter Required 1 Required 2 Required 3 Prepare a properly formatted segmented income statement that would be more useful to management in assessing run profitability of the various product lines. Mountain Dirt Bikes Racing Totals Bikes Bikes Sales Variable manufacturing and selling expenses Contribution margin (loss) 0 0 0 0 Traceable fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of the product line managers Total traceable fixed expenses 0 0 0 Product line segment margin (loss) 0 $ 0 $ 0 S 0 Common fixed expenses 186,200 Net operating income (loss) $ (186,200)